Join us on Wednesday, June 10, 2020, for a CLE presentation on “COVID-19: Perspectives for the “Next New Normal” for Renewable and Utility Companies.”

Companies are seeing unprecedented legal and business impacts due to the COVID-19 pandemic. These impacts are bringing about changes in strategy and how many companies approach their day-to-day business operations to adapt to this new business environment. This one-hour session will involve a presentation by the following K&L Gates attorneys sharing their perspectives on what to consider during the “next new normal.”

This afternoon, the Office of Legislative Affairs at the Department of Treasury, issued a letter to Charles Grassley, the Chairman of the Senate Committee on Finance, indicating that Treasury intends to issue administrative relief to the solar and wind industries regarding certain investment tax credit (“ITC”) and production tax credit (“PTC”) deadlines. Although the letter does not provide any details as to the nature of this relief, Chairman Grassley’s April 23, 2020 letter to Treasury requested that the four-year safe harbor for the continuous construction and continuous efforts test for the PTC and ITC be extended to a five-year safe harbor period.

Chairman Grassley did not request administrative relief concerning the impact of COVID-19 related measures taken by manufacturers and shipping companies on a customer’s “reasonable expectation” that materials purchased in 2019 would be delivered within 3.5 months after payment. This latter provision is important for purposes for establishing beginning of construction of solar projects in 2019.

K&L Gates is pleased to congratulate our partner Teresa A. Hill on being named to the National Law Journal’s “Energy & Environmental Trailblazers.” The National Law Journal recognized lawyers across the country that have moved the needle in the energy or environmental space through devising new strategies, pioneering technological advancements, litigating landmark cases, and other innovative initiatives.

Teresa was honored for her work in the cutting edge area of corporate energy sourcing, which helps corporate customers develop and implement sustainability and carbon reduction goals through their energy strategy.

In addition to her work spearheading the K&L Gates Corporate Energy Sourcing Initiative, Teresa focuses her practice in the areas of energy and infrastructure projects and transactions with an emphasis on on wind, solar, biomass, geothermal and hydroelectric power.

Expedited permitting and environmental review for complex infrastructure projects may soon be a reality. Buried at the end of its most recent transportation reauthorization package (the “FAST Act” or “Act”) is a significant new initiative intended to fundamentally change the way that federal agencies evaluate environmental impacts from, and issue permits for, construction of large infrastructure projects. [1]

National Environmental Policy Act (“NEPA”) review and environmental permitting for complex infrastructure projects can be costly and protracted. For instance, a U.S. Government Accountability Office Report stated that the average completion time for an Environmental Impact Statement (“EIS”) in 2012 was 4.6 years. [2] Between 2003 and 2012, the Department of Energy paid contractors an average fee of $6.6 million, and as much as $85 million, to prepare EISs. [3] The cost to prepare an EIS is often borne by project sponsors. Some transportation and water resources projects currently benefit from expedited permitting and environmental review procedures, [4] but the FAST Act is the first time that Congress has attempted to coordinate NEPA review across federal agencies and industry sectors.

In March 2014, the German government presented the details of its plans for changes in the country’s renewable energy support scheme. The planned legislation (the “Draft”), which passed the cabinet on 8 April 2014, seeks to curb the increase of energy costs and to promote a stronger market integration of renewable energy production.

Under the Renewable Energies Act (“EEG”), renewable energy producers are entitled to fixed feed-in tariffs and to priority feed-in into the grids. The spread between the market price and the feed-in tariff is levied to electricity consumers by a renewable energy surcharge (“EEG Surcharge”) whereby energy-intensive industries benefit from a reduction.

Under the EEG support scheme, renewable energy sources have experienced a boom in Germany, now serving as a source for about 25 % of the country’s electricity consumption – four times as much as a decade ago. In turn, the system has increasingly been put under political pressure as energy costs (especially for households) continue to increase. In addition, the support scheme is held to produce a paradox effect: whereas consumer prices increase due to the EEG Surcharge that levies the feed-in tariffs, wholesale electricity prices plunge because the rapidly growing renewables are flooding the market. The effect of this price development is tangible: Germany’s second largest utility, RWE AG from Essen, whose core business is electricity delivery, has announced a net loss for the year 2013 of 2.8 billion Euros. It was RWE’s first loss-making year since the end of the Second World War. Read More

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